Right Thinking from the Left Coast

Tag: Comcast Corporation

Comcast said Thursday it had agreed to buy Time Warner Cable for $45 billion in a deal that would combine the two biggest cable companies in the United States.

If the deal is approved, the combined group will be the country’s dominant provider of television channels and Internet connections, reaching roughly one in three American homes.

If this deal goes through, Comcast will control one-third of the cable market, dwarfing any other provider and having virtual monopoly in parts of the country (that’s one estimate; I’ve seen other figures as high as 42%).

There’s some question about whether the Administration will seek to scuttle this deal, as they did the AT&T/T-Mobile deal. Despite my libertarianism, I think they should.

Here’s why: cable is not a free market in this country. It is a controlled market where certain cable companies are given fiefdoms in most cities. They are regulated to some extent, but the consumer really doesn’t have a choice. I have Comcast. In Texas, I had Time Warner. In both instance, I had no real alternative.

If cable were a free market, then I would have a lot less of a problem with this deal since small cable companies would be able to out-compete the leviathan that Comcast/Time-Warner is going to be. But that’s not the case. If this deal were to be approved, it would have to come with a gigantic overhaul of telecom law that allows — or in some cases forces — markets to be open.

I don’t know if the Obama Administration will scuttle this. You may remember that the Most Transparent Administration Ever Which Has Totally Ended the Revolving Door approved Comcast’s acquisition of NBC. Then one of the commissioners who approved the deal got a high-paying job with Comcast immediately after approving the deal. So it’s possible that if Comcast waves enough money and future jobs around, this will go through even if it completely hoses the consumer.